Sluggish Growth for US Retail Sales as Confidence Dips

15 April 2002

In a sign that the US economy is not yet out of the woods, new reports showed that retail sales failed to rise as quickly as expected last month while consumer confidence has fallen slightly.

According to the Commerce Department, sales edged up 0.2% in March to $297.34 billion (€337.8bn; £206.9bn), below the 0.4% expected by analysts. Leading the growth was a 3.8% rise in gasoline expenditure, fuelled by rising prices.

However, holding back the acceleration in spending was a 0.4% drop in auto sales, down from a 0.7% increase in February – a fall attributed to the end of special finance deals. Excluding car sales, growth stood at 0.4%.

Separately, the consumer confidence index of the University of Michigan unexpectedly dipped from 95.7 at the end of March to 94.4 for mid-April. The drop reflected a fall in the future expectations component from 92.7 to 90.2, whereas the current conditions barometer rose from 100.4 to 100.9.

Explaining the decline, UoM researchers pointed to the slow stock market, a marginal increase in unemployment and continued crisis in the Middle East.

Data sourced from: The Wall Street Journal Online; BBC Online Business News (UK); additional content by WARC staff